seth felt live from the nation's capital, i am trish regan -- >> live from the nation's capitol, i am trish regan with "street smart." jobs report. hello, everyone. welcome to "street smart." a special show for you here in washington, d.c. until the minutes closing bell. we are talking about herbalife coming under pressure from washington's microscope. the fbi is said to be investigating traders who have

at some the company. that is according to "the new york times." industry here in do you see startups. we will speak to the radio leaders in the entrepreneur scene. all of that and a lot more coming up in the next two hours. we want to move on to this market. the big three. off to julie hyman at the new york office. anlet's start with alternative money manager. the company came out with its earnings and said it saw a profit decline of 6.7% and that is because it collected fewer fees from its hedge fund is mrs. because they were not performing that well. which is something we have seen -- its hedge fund businesses because they were not performing that well. that is something we have seen across the hedge fund universe. andumber two, we have wynn

that is because of when macau. it drew win more premium moremarket -- it drew in premium mass-market customers. there are more profitable customers for -- they are more routable customers for the company. and finally linkedin, we saw tumbled.res some analysts say that it is a function of linkedin growing and the growth rate slowing down. investors disappointed in those numbers today, trish. >> thanks so much. we are talking about a good jobs report. payroll up the most in two years and the unemployment plunging to 6.3%. however, look at the details. you have those numbers coming at a cost. more people leaving the workforce. the lowest participation rate since 1978. another problem, you have worker pay stagnating.

what do we make of this report? healths it fit into the of the overall economy? joining me, a global strategist private bank and an economist from deutsche bank securities. me on set to with break it down. 6.3%, a really good headline number. anyone's wildest expectations, 288,000 jobs. .his looks really sellable >> it looks like a home run. this is a good number. particularly for the nonfarm set. reside --two months, revised upward. all good news. construction up, retail up as well. you look at little more deeply and you see that participation wait, you see the noise and the unemployment number. .4%.p of .4 % --

we have not seen that since 2010. but there will be a question about how real that it is and wages. that will be a concern for folks across the country and the fed. >> it has to be a concern for the fed. they are no longer looking at just that six percent threshold for unemployment. they have to dig deeper. we have not had any inflation in this economy to speak off, and that includes wage growth. might that change, however? if you add 288,000 jobs in a month, oneh --given would think it would follow you would have wage growth? >> yes, it should. and i think it well. this is a report where the headlines, the decline in the unemployment rate, the gain in employment, really encompassed the hood details of this particular report. but the ratio of those seeking is a the unemployment rate

good indicator, even if changes in the labor force month-to-month can be a problem. .e continue to have growth it is a sign of strong demand in the economy. it should point to higher income growth. and inflation coming off rock-bottom levels over time. >> and yet, we are looking at a labor participation rate that is the lowest since 1978. what is going on? have that many people said enough, we are giving up? laghat we're seeing is a effect from the expired unemployment benefits, the benefits that were not renewed. a larger number of workers dropped out of the workforce. i think this will be temporary. so much for the new normal -- >> temporary? it has not been temporary.

there is nothing temporary about the -- >> that rate is coming down. >> not fast enough. not fast enough. >> not fast enough, but here is the thing. we are in the new new normal. for the activity growth is slow i am the economy and the economy is accelerating. >> ok, you are talking about payroll growth. i want to talk about the actual number of people getting jobs. peter, talk to me about what is really at stake here question mark >> he is right. it is coming down. about whatalk to me is really at stake your question mark >> he is right. it is coming down. yes, it is too high, but it is -- know, here we are, and , andmany years after 2008 you would think things would be

that much better. you would have an economy growing at better than an anemic that you would have a rate is much better. yes, we added jobs and that is good, but that is what we should have been doing all through this process. >> it is interesting. the fed cannot print labor. create those resources of people wanting to work. it is shocking to see a couple million people between the ages of25 and 54 thomas in excess population declines, have dropped out of the labor force since 2007. there has been recent stability and i think the fed is very inclined to allow labor markets to tighten and to experiment to see if that restores growth in the labor force, we are running an experiment here. luckily, they have a very low inflation rate as the starting point for that experiment. >> trish --

>> go ahead. >> if we are printing $200,000 or better, you will see that participation rate around the corner. >> good. a virtue.e is >> i know, i need to work on that for sure. i want peter to weigh in on this as well -- what is this going to mean for the fed? can we anticipate they are going to do exactly what they have been doing? does this change the picture i in any way? totrish, this enables them breathe a sigh of relief. the economy looked lousy in the first quarter. that will probably be revised, depending on next week's trade numbers. policymakers definitely have a question mark lingering over the paper move at next week's meeting. we discussed accelerating economic growth.

the other interesting point is this. if we look at the last five economic cycles, going all the way back to the mid-to late 1960's when the labor market finally crosses above its prerecession peak, which in the private sector happened last month, and we moved even further that direction today -- hiring accelerates. hiring accelerates significantly, on average 75%. that means we should definitely be printing well north of forward.oing that will stabilize participation, thereby removing the doubt that the unemployment rate is falling for the wrong reason, as it arguably did today, and it will show a much higher profile for consumer spending and implement growth and give a little upside bias to inflation. remember inflation -- couple of springs, we have that picture disappear on us with some good news. a big moment for janet yellen.

this report basically bolsters her own outlook, bolsters her own credibility. shows the fed may be on the right track. she will be in front of two senate panels. they just added the second one. if this number is good enough that changes the outlook for interest rates, and maybe an opportunity for her to say something. i do not think she will. well.o not think she final word? >> the fed will be more comfortable. it will know it is not making a big mistake by tapering qe, and ultimately looking at 2015 as a time of rising rates. ashad a report as weak 80,000 in the month of december during the winter months. we held back employment. we shifted that into this april and probably may period. above 200,000 get sustained, but -- >> i like it.

cannot blame the weather anymore. thank you. and our very own white house correspondent peter cook. coming up, it is a shift for the sec. can they protect from security threats -- cyber security threats? plus president obama and germany fell chancellor angulo merkel met at the white house today. will tighter -- german chancellor angela helmet at the white house today. will tighter sanctions actually change the situation in ukraine? we will be talking about that, next. ♪

its focus is shifting to cyber security, examining financial firms' preparedness for cyber threats. they are looking at how secure they really are. joining me, the former white house cyber security commissioner tom kellerman.

what is the sec's biggest fear? what is going on? >> the lack of reporting in the marketplace. more firms are being breached. significant resources in material risk. >> financial firms? >> broker's houses, major publicly traded companies. >> how is it we do not hear about that? >> off and they are not aware they have been breached until they are notified that their accounts are being sold and bartered in the shadow economy. >> it is terrifying because you think of your financial data being out there. it really means we are all being vulnerable in a certain way. who is responsible, would you say, primarily for a lot of these attacks? are they internal? are they coming from abroad? >> they are coming -- it today -- it takes six months to notice that you have been

breached. >> six months? it takes that long to notice the data is missing? >> they are conducting frontline examinations based on what is happening in the boardroom on compromise financial systems. >> what should the sec be doing? >> i think the sec needs to modernize management. there must be mandatory reporting for cyber breached organizations. they should have a strategy, and incidents response plan -- >> they do not have a cyber strategy? >> the sec may have internally for the sec, but most firms do not have their own cyber strategies that are necessary in this very hostile environment. houses, bigoker banks -- >> most large financial institutions do have plans i am place. but they are being hunted by the biggest hackers and the world, most in eastern europe. -- most large financial

institutions do have plans in place. >> let's talk about eastern europe. we have been talking about ukraine. what is the chance we are going to pose sanctions, given that a lot of these tax are happening , does thatern europe mean we will be more vulnerable? >> very much so. -- we will see more patriotic hacking. >> patriotic hacking? >> they are being called upon to crush the u.s. and their allies economicaging these sanctions. you can see harbingers of these. >> that is what you are worried could happen? >> i think the u.s. does not have the sole power to punish someone through economic sanctions. >> ok. bottom line? we need to be prepared.

ande need to be prepared cyber security should be viewed as an operational functionality tom and not an expense, but a functionality of doing business. >> before you go, we saw that target just hired someone who you may have worked with. someone from homeland security. do you think that will help target in terms of its preparedness? >> target has a monumental task in front of it. i hope with its leadership they can move forward in a proactive way. they need to get rid of what is in her house and that is probably multiple backdoors that need to be eradicated. >> tom kellerman, thank you. president obama welcomes angela today,to the white house but will more sanctions push vladimir putin out of ukraine? we have more "street smart." i'm back in two.

♪

>> all right, it is time for today's global outlook. eastern ukraine, escalating violence as president obama and german chancellor angela merkel met at the white house. the two leaders warned russia they are prepared to impose more sanctions. >> the goal is not to punish russia. the goal is to give them an incentive to choose the better horse, and that is to resolve these issues diplomatically -- a better course, and that is to resolve these issues diplomatically. and i think we are united on that front. >> they set a may 25 trigger date for economic sanctions, but will be sanctions stop putin's

ambitions? joining me, a director of russian studies at the kanin institute. >>l this stop? we have tried times with sanctions. it does not seem to be helping much. >> putin has certain geo- political objectives. these sanctions will hurts. they will hurts going forward. in terms of the short-term to strategic objectives, he is not going to be deterred -- >> when you talk about his objectives, what are we talking about? does he want all of ukraine? just to cooler areas? wants allt think he of ukraine. if he wanted to invade ukraine, he could've done earlier. his main objective is to under main -- undermine the legitimacy andhe current government delay the elections. >> why delay it unless you want all of ukraine?

>> he wants ukraine to be kind of invited and that division would be a loose confederation, as opposed to the current unitary state of ukraine. i doing so, he would be able to keep eastern ukraine at least in russia's orbit. that is very important, because the ukrainian military industrial complex is centered in donetsk. >> he has threatened military action, saying he will do what ever he needed to do to protect the russian ethnic minorities in these areas. what does that mean to you? and are we going to see him use military force? >> what that means to me is if putin believes he is not achieving his objectives, if a unified ukraine is moving in step to the west, that is something putin will have to stop. >> he is keeping his options on the table? >> absolutely. >> we are looking at increased

violence today. so, ukrainians are fighting back? >> yes, and it is the separatist mobs in these individual cities, the ukrainian purity services during the best they can -- >> but what option do they have? wants todecides he send troops in? >> if 40 thousand well-trained russian troops enter mainland ukraine, the ukrainian army will not be able to resist that. >> and he has positioned them there, by the way. >> oh, they are ready to go. they have been ready to go for months. to deal withying individual uprisings, as they see it, and squash them. >> do you see it at all his merkel is willing to join hands with president obama? ray beasley europe has seemed reluctant -- previously europe has seemed reluctant. >> it is a success, but i'm not

sure we know what angela merkel means. they stood united today. i think when push comes to shove -- we are not sure to what extent they are willing to follow the u.s. --y have very dense of -- they're very different incentives. >> to your point, he has very strategic territorial goals. if it means economic pain in the near or short-term, so be it? inbe sanctions do not work terms of stopping russia. where they work is creating uncertainty with dealing with russia. the added sanctions and the threatened continuous increase in sanctions hurts the russian economy, an economy we believe is already in a recession. >> and who would want to invest in their now knowing what is coming down the pipe? william pomerantz, good to see

you in person. coming up next on "street smart in thealife is back spotlight, but could it be the traders and hedge funds find themselves in trouble this time? we will speak to the former sec chairman harvey pitt as we discussed this. ♪

>> ok, welcome back, everyone. we are live in the nation's capitol, washington, pc herbalife shares have been pushed all over the place, with every new headline from carl ackman causing a sharp move in the stock. but now traders are looking into a suspicious trading. the sec and the fbi are investigating bets on herbalife and looking into whether traders were encouraged improperly to bet newsst hls before bad

emerged. joining me, harvey pitt. good to have you here. let's talk about how the sec might the going about looking at this right now and how they might be able to prove insider trading? >> it is painstaking work. what they do is, first they get a list of all the trades. the identify all those traits that occur approximately in time to the announcements by acumen that occure trades approximately in time to the announcements by ackman. they look at trading patterns and ultimately they will conduct investigative depositions of all of the people responsible for trading decisions to find out what communications and context they had with anyone involved with him. have in this particular case you have allegedly one guy telling his

roommate he is going to short a stock. know in advance there is going to be a press statement and you trade in advance of that, that constitutes improper own strategies, even though it may have come from ackman's company -- >> someone profiting on the news that was coming. because they knew it was going to have an effect when he came out with a big reason tatian? -- resin tatian? -- presentation? >> yes, we are so supposed -- we're supposed to be surprised. and if we are not, the government may investigate you. >> how do they investigate this? >> they look at communications. these days it is almost impossible for people to communicate face-to-face. they communicate by telephone. they communicate by e-mail. all of those records will be

pulled by the sec people who are quite adept at looking at this information and showing patterns of conversations that took place right before certain trading activity. >> the sec has been looking at hls for a while. they do not seem to have found anything yet. does that surprise you? >> they have been looking at hlf , in part, based on ackman's allegations. these are two ackman's this advantage because it is -- these disadvantage's because it is about the lack of trading principles at -- >> what you mean by that? >> every hedge fund like ackman effectiveosed to have policies to prevent the disclosure of material nonpublic information. if ackman's employees are diebold ching information, that

would he a violation both of -- divulging information, that would be a violation both of his policies and -- >> could ackman be held responsible for this? >> he could be. capital, they sac are charging steve cohen. if someone were tipping information -- and we do not know that that is the case -- but if somebody were doing that, how were they able to and what protections did ackman put in place to prevent it? >> how much do you think someone was working on something and just in passing leaked something and then the ball starts rolling from there? >> unfortunately, i might have said before all of this hoopla evolved that it happened infrequently, but it is very holster adage he

has not been about imparting news to the public. -- whole strategy has not been about imparting news to the public. it has been about -- the sec is making sure that there is no insider information. >> it is in his interest to let other people in these -- on the street know he is about to short something so they all short together and they all come out ahead? encourage, and to other funds to sell stock as well, even if not before the event, to try to put more pressure on herbal life -- herbalife's stock price. >> what about carl icahn? >> carl icahn has been very critical of mr. ackman's

strategies here. he says he is not shorting herbalife. you have two activist investors going to dub different directions. >> it makes for quite the saga and we are adding to its here. harvey pitt. thank you so much. >> good to be with you. coming up, steve wynn does not see eye to eye with george clooney. find out what they do not agree on, after this break. ♪

>> all right, you know, a guy like steve wynn does not become a billionaire casino owner without amassing a few stories along the way, right? down with anle set exclusive interview with steve fondestss some of his memories of las vegas. >> frank sinatra and dean martin

working weekends and my job was to fly them to atlantic city on my plane and bring them back to l.a. on sunday night. for three years, frank and dean were my guest and stars in my 500-seat showroom. and they were cutting up and raising hell and i got to hang out with them. that it clips is everything else i got -- i have ever done. making a commercial with frank and dean. >> would you say they are the coolest guys you have ever met? >> yes. they were absolutely unbelievable together. frank sinatra doted on dean martin. was a natural, laid-back, witty guy. he said funny things. he had a funny attitude towards the world. sinatra adored him. they were noncompetitive risen now these. but they loved each other. >> i do not want to get into high drama. i know you had a disagreement with george clooney last week. >> [laughter]

feelings asurt your an american businessman, someone who works as hard as you do, when celebrities love to dog on the republican party? who have not done their homework? >> they do not know what it is like to run a business. but it does not hurt my feelings. artists, actors, people like that. they live in a very strange bubble of their own. they are mollycoddled. they are highly privileged. we're talking about successful artists like george or barbra streisand or successful performing artist. they lived in a relatively small world. the people around them are very solicitous and caring for them. that ise a worldview therefore everything should be given to everybody because everything has been given to them. , if youun a business

are responsible for a lot of people, you come to grips with the reality that you have to have discipline. you have to protect the enterprise in order to take care of the employees. so, therefore you can't be wasteful. you can't squander things or you jeopardize other people. so, running a business gives you isense of compassion that defined in different terms than someone who just aims of themselves as generous or who single environment. we know real compassion, the real benefits to the working people of america will only take ways as long as america is healthy. oh healthy means we cannot $18 trillion-- owe because that day will cause all of the working people in america to suffer. so, the act or is, the hollywood

crowd, they are understandably -- the actors, the hollywood crowd, they are understandably the victim of their own special privilege. we know the hollywood people in las vegas. george clooney is great to work with. you just have to watch your timing. he was a little into the tequila. but he is fun to be with. he is a good storyteller. want to run for president? >> good question. i think hillary clinton is going to run. she will be a good candidate. there are republican governors who have done terrific jobs in their states. scott walker, chris christie. job inh did a great florida. i think republican governors have shown you can take care of your citizens, be compassionate or your citizens, be fair to

your citizens, and run the state wisely so the future is not jeopardized. i think that is the lesson we will try and convey, hopefully -- whether you are democrat or republican -- that there is a path here. , the greatocqueville french political philosopher, system ofamerican democracy will prosper until such time as the -- politicians is covered they can bribe the public with their own money." it is a path to destruction. it will not make for a better future. it will destroy them. >> all right, he is quite a character. and to steveph wynn for that. coming up, the unemployment rate did drop and the payrolls did

increase. i will speak to the vice chair energy and commerce committee, marsha blackburn joining me from tennessee, next. ♪

>> welcome back, everyone. in april, the u.s. economy saw byitive developments. rising two hundred 88,000, far more than economists had anticipated. -- 288,000. joining me from nashville to discuss the jobs report, republican representative marsha blackburn, who serves as the vice chair of the house energy and, skim it he. >> good to be here. the vice chairs of the house energy and commerce committee. in anyway signal

we are in a real economic recovery? >> i'm afraid it does not. trish, you look at the data. this is great. .88,000 more that is great. but then you look at the data. you still have wage stagnation. you still have weekly hours worked at 34.5. which is not healthy, not a good trend. the other thing is looking at that labor force participation rate, and you saw it go down 62.7%. that is off concern to me. you have those people opting out of the labor force, no longer looking. see that that we would labor force participation rate improved and i'm terribly disappointed we did not. >> you did hit the nail on the head in terms of those two issues.

have not seene any wage growth. and a lot of people saying enough, and opting out of the labor force. which is not good to say. let's talk about the political implications. 6.3% is a good headline number. 288,000 does sound good. will your average voter be able to peel back the layers and look at things like wages or the number of people opting out? is there the impression of things being better given the headline numbers? >> a couple of points. people will hear the headline and they already do not trust the way this administration puts out accent figures. we hear this all the time. they will tell you, when you are talking about the cost of living -- of course it costs more to live. they are paying more at the pump. they are paying more for groceries. they do not believe these numbers when they hear them.

>> let me ask you about that. do you believe the numbers when you hear them? what is behind that? that.uestion what people have realized is this administration reconfigures how they report your employment rate, how they report the cost of living. so, it is like -- >> what do you mean reconfigure? >> if you are not going to consider food cost and fuel cost, and necessity items that go into the cost of living, then they begin to doubt what they are hearing from this administration. i will tell you this also. what people are seeing is more , but fromy from d.c. their state general assembly said legislatures, they are getting more certainty. i think the jobs growth we are seeing are coming from states who are lowering taxation rates and are dealing with litigation and especiallys

looking at some of the class action lawsuits and frivolous lawsuits -- blackburn,tative we're almost out of time. before i let you go, and to stand you were in my home state of new hampshire recently. >> yes, i was. >> that is interesting. one reason people go to new hampshire is for campaigning. there was talk that you may be putting your hat and the ring for a presidential bid. what do you say? >> oh, no, i am not putting my hat in the ring for a presidential bid. what i do is to promote the cause of freedom. i had a great time at the freedom fest in new hampshire. i had a great time. >> that is great to hear. marsha blackburn. all right, coming up, we have the top 10 stocks you need to

know about. the close of trading is next on "street smart." i will see you right back here. ♪

>> all right, live from the nation of's capitol, i am trish regan. "street smart" is heading into the close. time for your top 10. rbs jumping the most int w is in london. rose to $2er profits billion. >> number nine, when macao up almost 45%. they posted earnings that beat analysts estimates. estimates.'

>> number eight, google shares. the internet search giant is being sued for allegedly using its markets power to force android systems to use its apps. the restrictions, they claim, made the phones more expensive. >> sony up almost 2.5%. the maker of the playstation those did a wider than expected forecast. of oneminary net loss point $3 billion, the third downward revision for this company. matt. is linkedin. the professional social network that fell short of analyst's as to ms.. they hope to fuel a revenue rise. sayse athletic shoe maker

it may lead a group and buying part of the los angeles clippers. this would give skechers a market opportunity to turn its brand into a serious athletic brands. of course they are enjoying a long line of other people who have said they are interested in the clippers. there is a lot of competition. >> there definitely is. all of the players for the clippers, obviously would wear skechers. washe boston marathon wearing skechers, right? that was a big move for them. the shares went up on that day because they had btl. >> i did not know they were trying to do that. i thought that were skechers were just for dan marino to shape his butt. are aerobic shoes. apparently they are basketball shoes, too. >> or skate shoes. no? next, skullcandy, posting

less than had been estimated. sales were slightly lower. the company forecast second-quarter to be about breakeven. >> number three, news corporation, down slightly. by -- by rupert murdoch has announced it will purchase harlequin, the publisher of super cheesy novels. it is expected to bolster their unit sales. >> i am so surprised that harlequin is worth four to $15 million. >> i cannot believe they are still around. >> the company following the most since 2011. to help patients in

a drug trial. the study was canceled after they showed that they did not have efficiency in their treatment. >> and that is the bell. we have pfizer and astrazeneca. astrazeneca said that the offer failed to appreciate the value of the promising medicines under development. here we are with the markets. as an be posting record highs. the dow lower for the second straight day. at -- the s&p posting record highs. a little bit of upside. about one percent on the week, despite a second straight day of losses. let's go to julie hyman. >> it was an interesting day today, because what we saw were a few of the high flyers this year. best-performing stocks this year. guess what? they are the worst performers today. what is curious about that, the

overall reaction, if you look at the bond market as well, did not seem to draw any conclusions about the interest rates from the jobs report. but judging from the utilities group, you would think that there would be an outlook that rates are going up. an interesting phenomena in there. health care is the other group i am talking about that has done very well this year. of oneout three quarters percent. they account for the bulk of the declines the session. material and discretionary were up. the defensive games were down. we got that mixed jobs report. and a lot of them going into the weekend -- they do not necessarily want to be long on stocks because of what is going on i in ukraine. and it is not the real -- the reale's of investment days of investing in u.s. equities, trish. >> it is time for a special

edition of the roundup. here in washington, i have al hunt, phil mattingly, and peter cook. good to see all of you. >> good to see you. >> we will kick it off with adc story.t --a d.c. .he president and angela merkel it seems like the enemy of my enemy is my friends. with the revelation about the nsa spying on her cell phone. it seems that they have put that behind them here. we talk about the sanctions and this trigger date of may 25. are we really, really going to see merkel be willing to do what it takes to influence vladimir putin? what do you think? al? isthat is why this meeting important. the brits r berkley willing to

be tough. and america has said we have not been as tough as we would like because we have to do it in concert with the europeans. merkel is gay. if they join, we can take the next -- merkel is key. can take the we next step. >> william pomerance was on earlier saying that putin does not care about the economic consequences. it is much more political, much more strategic in terms of adding these territories. ultimately what are we accomplishing? >> we might see more of the germans got on board with really strong sectoral sanctions. even the energy sector, which the president downplayed today. that would cause real pain in russia. would it be enough to move vladimir putin? who knows. -- who knows? but they are not there yet.

>> the interesting thing to watch with the sectoral sanctions, it is clear that they do not want to move to the next level. it is very clear they are not going to have a choice. froml is getting this hard the business lobby at home. for her to come and maintained with the president, very important for the time being, but very important for them both to acknowledge -- it is going to be hard and what sectoral sanctions will look like is not what the u.s. would prefer them to look like. >> and trish, sanctions never, never work short term. whether it is south africa years ago or iran more recently, it takes a while. as john mccain said, this is a gas station pretending to be a country. iny may go into a recession even deeper. >> people are talking about them being in recession right now. a lot of economists believe they

are in fact there. if your president does not care -- i guess at some point the people care. >> we are not going to send troops in there. sanctions are the toughest steak they can't put out there and what else do they have in the toolbox beyond that? >> what is the thinking? is he going to go for more here? does he just want eastern ukraine? does this become an issue where he is grabbing more territory? >> the thing that is unsettling from the u.s. side is they have no idea and one of the people they relay on -- rely on is angela merkel and her relationship with vladimir putin and she has acknowledged she does not know where he is going. investors, if they are looking for yield, they are looking at russia to get in. how do you go to a country like that where you do not know what the leader wants? nobody knows what his endgame is right now. >> the prime minister of latvia,

in the neighborhood, she took over the country 100 days ago. she has u.s. paratroopers on the ground in her country, and she came to speak to the vice president to ask for a permanent u.s. military presence in latvia. that is where things are there. >> what you think the chinese think of putin and the russians right now, and he said, they think that they are totally irrational. that could cause damage. >> you have the next story, peter. >> i do. let me tell you what it is. >> zip cars? >> i heard about this. i do not have a zip car. i have a real car. but you can take a zip car one way down to d.c. and leave it there, park it. is this a successful business question mark i don't know. >> i don't know. >> these things could be a

legally parks. >> thank you, thank you, al. newsne else is making right now. kevin spacey. did you see this? "call of duty"? the new trailer for the next installment of the popular video game. fans maye of cards" recognize a sly reference to his character's love of videogames. kevin spacey in "call of duty." he is note anywhere right now? he is basically the dean of washington. no offense, al. you are always the dean of washington. nother it is netflix or -- because he needed a career resurgence, but he is the guy. >> my boys will now know who kevin spacey is. >> he could use another header.

>> a big weekend this weekend, right? >> that is right. >> the washington correspondents dinner. the nerd prom. affectionately known as the nerd prom. a lot of events going on, tonight as well. you have tech firms like yahoo!, google, tumblr. there is the google netflix party with the house -- with the cast of "house of cards" making an appearance. and google and youtube are offering a blowout and manicures -- really? i did not get signed up for one of those. but this is sort of a fun time where you have washington and hollywood coming together with is sort of -- it a very unique event in that sense. ahead. >> i'm going to boston.

>> i heard you are not a fan of this. >> i can't wait. it used to be a reasonably semiserious thing. now it is something that you do with while house -- white house correspondents. if they want to have a big party weekend, that's fine. but do not do it under the auspices of the white house correspondents. >> a circus? >> it is a circus. >> there has been a backlash. whether it gets scaled down this time around. from the blowout sand manicures, it does not sound -- >> really? years ago, different kind of thing? >> it was. it was 20 years ago. i do not mind hollywood coming to washington, having parties, seeing kevin spacey. that is great. of thepretend it is part white house correspondents association is kind of silly. and boston is going to be great this weekend. >> i bet. those other thing with

parties, they all have a tech side. this is a strategy. without question, this is a strategy. you sponsor these parties because you want influential people to attend. tech firms have really moved in on washington in the last couple of years. this is part of that game. i got one invitation that said i was supposed to show up in start up chic. >> you look great in start up chic. >> what is that? >> but they are tapping into washington, like silicon valley. silicon valley knows that washington is key. get bigger.ues their parties get bigger. >> that is it. >> it is true. >> hence the bigger and bigger events every year. speaking of parties, monday is cinco de mayo. to think twicet about ordering a margarita. that is because the cost of

lives has more than tripled, squeezing the margins of restaurants and bars. lime prices surging after growers and together to set ravagedfter disease-a crops. i'm not sure why we are talking about this. >> the lime cartel. >> what does washington have to do with the lime cartel. -- cartel? >> a lot of people in washington drink margaritas. >> it will be drinking them tonight. [laughter] serious stuff that is going on. angela merkel joining forces with president obama. say,is what -- would you the number one issue right now, what to do about vladimir putin, what to do about ukraine? evolves.see how it it is not anywhere near the most important foreign-policy issue long-term, but it is certainly

the most important crisis we face right now. there is no other place that rivals it. it depends on how it plays out. it depends how long putin can be as bad as he has been. i am more worried for my grandchildren about our relations with china and the middle east. but i certainly think for now it is a crisis. >> the what does the electorate think, al? >> they don't want to be involved. a 11 years of war. i'm sorry. they don't want america to be engaged. that may not be a good idea, but that is what america thinks. >> and it is europe, too. this was a time when the u.s. military was exiting out of europe. driving down from the four brigades, and now we're talking about moving forces back in to europe? this is a changing landscape. we are not talking cold war, but this is not what president obama

went to talk about at this stage of his second term. >> and here we are. your manicure.et >> and the blowout, too, right? thanks. coming up, washington does not agree on much, but they'd made on this -- but they may on this. rethinking the tax code. grover norquist joining. ♪

>> ok, washington may not agree on much, right, but one thing washington seems to agree on, it is time for a tax overall. got the ball rolling. the key part of his reform? rates? and corporate this week republicans and democrats came together as the house ways and means committee approved six tax breaks. joining me, grover norquist and

maya macguineas. all right, guys, we have basically a tax reform that basically includes helping businesses expand, april that will increase tax deductions for business equipment. are the steps in the right decision, maya? >> i like the way that chairman can't start the process. he was talking about a big -- that chairman camp started the process. he was talking about a big overall. he was talking about changing our tax code which is not been overall than decades. these are baby steps. to my mind, we are doing it in the wrong way, where we are extending tax breaks that take off the pressure for the bigger reform. and we are not offsetting the cost, so they will increase the debt. they may help to rid some are good for the economy, but adding to the debt is bad for

the economy. >> what about those who would say, hey, i have never seen a tax cut-like? cut that i did my? are you in that camp? i have never seen a tax cut i did not like? certainly moving towards full expensing in terms of how you treat business and investment. here is the challenge. the president and harry reid both said they will not consider tax reform significant overall it does not at least cut $1.4 taxes.n of that is not going to happen. for the next three years, as long as the president is the president, we will not have tax reform. now we are focused on the little stuff, like the extenders. them, somed all of of them? make some of them permanent?

maya mentioned one of them. the expensing. the expense -- we should just do expensing. permanent --things >> per minute, that is part of the issue. there is no sense of what is going to be permanent. >> if you look at the senate, they were talking about extending these things for a couple years, which leads us with the tax cuts expiring. businesses are trying to lead. they have no idea what tax environment they are working in. that is terrible. i think it is important to talk about making permanent and adding stability to the economy, but i think you want to do it in a way where you are offsetting the cost. you could cut spending so you would not add to the debt. the fiscal ramifications of throwing it on the national credit card will undermine the improvement some of the good ones could generate -- >> hold that thought.

we have breaking news. i want to head back to new york. jpmorgan?ews on julie? >> we had a filing and they revealed the second quarter trading revenue will likely decline 20% from a year earlier. the bank says this new forecast reflects "a continued challenging environment and lower corporate client activity levels." is ahis in other words forecast that is subject to change. remember, fixed income trading fell 21%, which the bank reported earlier in april. struggles ininuing the markets and trading business for jpmorgan. not necessarily good implications for that bank. and also for the other banks that are heavily into trading. trash? -- trish? >> thank you. withr and maya will stick

me on set. we will continue this discussion on taxes and tax reform and our roundtable next. if you are thinking of starting a business, why not washington, d.c.? we will talk about what our nation's cap at all is the doing to attract startups. ♪

>> live from the nation's capital -- you are looking at a live picture of l. im trish regan. this is "street smart." still with me, grover norquist and maya macguineas. we were talking about what needs to be done.

we are talking about what businesses need to feel clarity when it comes to the tax code. we were talking about two trillion dollars-plus sitting offshore. pfizer making -- a bid for astrazeneca in parts the car is there is this strategy in play. and they can keep their money overseas they have been making over there. >> as grover was saying, nothing is going to get done for a couple years. that may be part of the sticking point. system ise political that not much is getting done these days. lose one $.3 trillion in revenues every year. trillion in revenues every year. our rates are so high, it's

clearly not competitive. our global differences with the rest of the world means we cannot compete. >> it is worse than that. we are 35% at the federal level. the average for the states is 40%. canada -- 25%. wepean average is have a world wide tax system. most entries have a territorial system, which means -- most countries have editorials -- territorial system. >> it means it's fundamentally against what we have always provided. if we give them all of these targeted tax breaks, and honestly, if companies are leveling the playing field -- if you talk to them about what they --

>> hopefully we will get it one of these days. grover norquist, thank you for being here. maya macguineas. coming up, we will talk about whether you can starting new business in bc -- in d.c. ♪

>> welcome back. i'm trish regan. when you think of startups you may not think of our nations capital. my next guests are hoping to change that. a community of venture capitalists in washington are trying to make d.c. the next hot startup scene. joining me to talk about what is going to take, some of the challenges that d.c. faces now, we have eric auster, a andessor, eddin burfield,

phil bronner. great to have you guys here. it. is it fate -- what is you run an incubator. what inspired you to start this incubator here of all places? >> absolute. but we do is help startups that stuff in important education, health care, energy, transportation. smart cities. the kinds of energies in which the unique networks and resources we have in washington could be helpful. we help them. the name 1776, the declaration. it is the duty of the people. >> i like that. phil, what are the best qualities about d.c.? why is it people should be looking someplace like this? >> when you think about the internet, it has gone through three ways.

online. then you had social. thingsis the center of that are certain to permeate people's lives. that is going to impact traditional industries like health care, education, and industry. you focus on those sectors being close to the federal government is important. we have a company that went public in education. businesses are the ones you're going to see coming out of washington. >> eric, we were talking earlier, a lot of the parties being sponsored at the white house correspondents dinner our tax companies that are sponsoring that. there is a reason. the bigger the tech parties become. as we heard phil say there is an advantage to being close to the source of power. this is a government town. if you are working in the tech business, it seems as though

everything here centers around government. how do those intersect and play together well? >> i think it is what is interesting. d.c. does inspire big ideas. we talk about them a lot. you're talking -- you're singing a lot of young people who are getting ready to leave and do something innovative. i'm seeing a lot of people came out of the white house apply to my company saying i would love to work on some that can be big. >> what you're saying is you have talent. >> it is a joke but the truth. we do a lot of events at 1776. tons of congressional staffers come to those events. they said, i have to bring my boss bought. i would love to meet the startups. after three drinks, i'm working on a startup idea of my own. i would love to come by. >> you get a lot of creative people. well-educated people that have a lot of energy. that is a good resource. we were looking through the

statistics. in terms of angel funding, if you look at the angel startups, washington dc is on the list as number one as a place where you should be. surprise.it of california is coming in at number two. what is it about the funding that is flocking to this area question or >> i am part of one of these groups. 90 angels under 40 years old. that is what you are starting to see. since there are fasting -- since there are factors working against d.c., they are banding together. that has helped us get people funded quickly. likes it is not just angel funding pray their great venture capitalists here. raised $21 million in washington dc it is access to capital. it is access to town. having a regulatory environment that is supportive of startups. >> talk to me about that.

the regulatory environment is important. if you look at the environment, and the tax environment, what is it you like about d.c.? >> you look at the washington dc area, you have three jurisdictions. the washington dc area, northern virginia, and maryland. all three are looking to court entrepreneurs. >> we like competition. >> exactly. effectiveaking a more tax base. a providing things around real estate and other things that make it attractive to start a company here. >> if you had to pick anywhere this is home. this is where you would choose. all right. good stuff. thank you. coming up, later on, taking time to reject a bid. what the biggest issue with the offer was.

our?of the ip to right warren buffett a letter.

>> welcome back. i'm trish regan. this is "street smart." we are live in washington, d.c. what happened when you write a to comeo warren buffett to the shareholder meeting? he writes you back. he invites you to come. >> my name is marcia. i'm a resource specialist. name.eople don't know my they just call me gutsy. i love berkshire hathaway. i diversify the company they

invested in. i set a goal to become a shareholder by the time i was 40 years old. i just decide i'm going to write warren buffett. just ask him, would he ever allow non-shareholders to attend his meeting? i thought it was junk mail. i almost tore it in half. this is it. then i opened it. almostally wrote me back immediately. he told me to contact his assistant. at are going to meet mutual place that he was going to be attending this party. he comes over to me. i said thank you for allowing me to be here. already, it is an amazing experience. he says, i just hope you get what you were looking for. it is all about meeting great

people. just like yourself. he was paying me a compliment. what a great guy. many of the vendors are there from all the subsidiaries. warrenld see war and -- playing bridge. so many things that you see and learn. i called my stockbroker and i said i have become a shareholder. just by me up whatever i can right now. respected, like i was worthy to be there, and worthy to be acknowledged. that is just awesome. next, whyup astrazeneca said no thanks to buy this $1.6 billion bid. that's after this break. ♪

>> earlier today, pfizer increased its bid for astrazeneca. they were quick to reject the offer. for to discuss what is next the uk's second-biggest drugmaker, a partner at jones day. and'suses on takeovers, restructuring. always good to see you. what is going on here? -- $106.5 $.5 billion billion. ,> compared to their future they may think the future is that more valuable. it is not atypical when you get initial indication to see no.

-- to say no. >> how much more that they might be looking for? price andnds on the the underlying values. i am not privy to that. offerarely is the first the final offer. what somealk about people have pointed to. the tax implications of this deal. it is very much in pfizer's interest. they would lower their tax rate. someone pointed out that this may be more about the tax issue than it is about the strategic advantages of these two companies would represent together. what is your view? how important is the tax aspect? >> tax planning is a part of any deal. tax attributes, whether it is conventional to vesture, merger,

whatever, there is always a tax plan. i have a hard time believing is the motivating factor. it is not a relevant. it will probably contribute to evaluation. there have been so-called inversions. there is a lot more being thought about. so many that some of us are starting to wonder if people in washington are going take a look at it. there has already been a few signals that maybe this isn't so good for the usa. in terms of this structuring. when you stand back -- >> let's get into that. what do we stand to lose? the u.s. economy. jeff is the guy who runs our mna team. hang tight. what would you say the u.s. stands to lose as a result?

>> presumably, it is going to lose whatever tax revenue when someone like pfizer moves their operations offshore. it doesn't all go away. it is complicated based on where the sale starts. -- they wouldone go to a place where they would pay 21% or 20%. perhaps even lower than that. as for the political elements of thatfizer seems confident they are going to be no retroactive steps taken. if someone does close this loophole will be after the fact. it will be after pfizer get the deal done. so, we have seen other companies do similar moves. is this a new trend? american corporations are looking to headquarter themselves elsewhere through a

strategic deal? >> it is not a new trend. it is an accelerating trend. where as it used to be billion companies, what happened is it has built upon itself exponentially. to billion dollar company became a $5 billion company. they started snapping up others. then it is $20 billion and 50 billion-dollar companies. pfizer takes it to another level. this is the largest company to do it. someone should take the question to d.c. if pfizer can do this with a market cap of $200 billion, what stops ge, at&t? what stops general motors. reported on at&t looking at in the past as an acquisition. but with the rmb if at&t decided to do this?

>> not good for us at all. we have to leave it there. thank you. switching gears, we are talking about this saturday night at the mgm grand garden arena in las vegas. floyd mayweather will look to protect his undefeated record in his whether weight site. joining me, the highest paid athlete in the world, floyd money mayweather. welcome. >> thank you for having me. >> you were earning a minimum, guaranteed, $32 million this saturday. you earned 73 million in 2013. what is your sequence -- what is your secret to concrete negotiations? >> we don't know what the exact number is. of what i made in 2013. but, i'm sure that we going to the good 2014. the only thing we can do is keep

our fingers crossed. the remedy is just being smart. pointto this particular in my career by doing the right thing and surrounding myself with the right people. >> is that a part of it? surrounding yourself with the right people? you are doing better than anyone else in the industry. obviously, in addition to pure talent of being able to win these fights, you have negotiated from a business standpoint the right kind of deals. >> i didn't do by myself. guys, two very shrewd business guys. we worked hand-in-hand, day in and day out, to put certain numbers into place so i got the biggest deal in sports history. about this fight.

is this going to be your last? >> i don't think it is going to be my last. some day you wake up one way, and the next you wake up feeling another way. it is going to be a very exciting one. i can promise that. i want all the fans to tune in to my paper review. it's going to be a good one. >> according to reports, it has been said that you have zero income from endorsements. here you are as the highest-paid athlete. >> that's not true. >> that's not true? >> i'm endorsed by them right here. by the money team. the money team.com. go to the website. >> there is a few endorsements that have been built into your contract. let me ask you about the

business of boxing. what has changed? versus when you got in, it is a business as a pro. business -- tois get to this level, absolutely. it is more business now. you have to do, there are a lot of things you have to do to fight this magnitude. it takes a lot. betakes six months to able to fight at this caliber. it takes a lot. lacks all the planning. >> a lot of traveling. a lot of negotiations. the main thing is knowing the right people. shaking hands with the right people. doing the right things. let me ask you, your thoughts on what happened with the donald

sterling and the clippers. your reaction to what has transpired. -- i hearnald silver that you may looking to buy the team yourself? >> yes. i've been negotiating. i reached out to magic johnson yesterday to see if he wanted to join forces to work together. was with justin bieber last night. we talked. he is interested. >> what would you pay for it? your opening bid? >> i can't really say. , thoseype of numbers type of negotiations are handled behind closed doors. >> that's a good answer. don't give anything away there.

floyd mayweather, good luck in the fight. thank you very much. >> thank you. >> good to have you. back with more after this. ♪ >> it is time for bloomberg television on the market. let's take a look at where stocks closed the session. he saw the clients today. the jobs report looks better than had been estimated when you look at the payroll number. when you look at unemployment data there were reservations about some elements of the report. stagnating wages. -- traders did not want for theross the board

dow jones industrial average ended the day down a quarter of one percent. askedorning, betty liu pimco ceo why the arcade and have a bigger reaction to the jobs report. that this has, may have an impact on the fed. that is what the market is worried about. it is not a strong report of a war it is the fed support may not be there. if you thought the fed was just issuing one objective of the june mandate, unemployment, with that unemployment rate at 6.3% you get worried they would start tightening. the fed is pursuing two objectives. near there.re it is important to market to take account of the unemployment picture and the inflation picture. >> it is time for adam johnson's insight and action.

he is following the money. >> that that may be tapering its qe bond buying program. not the rest of america. corporateking about qe. .ook what it is talking about it earlier this week, distribute in cash via buybacks and dividends. you can support stock and asset prices all growth is low. the same thing that the fed is doing. you're putting money into the system. in this case it is corporate america trying to inflate stock prices. there is a catch. he you are substituting investment in the same way the fed might be crowding out other investments. we will get into that. this is still going very strong. what we decided to do was actually the companies that are engaging in this corporate qe. and has beening

working, it should continue to work. dividend yield of two percent. dividend growth of 15%. buybacks announce within the past year. all forms of corporate qe trying to push out stock prices. we found a number of different names, apple, gamestop, international paper, wells fargo . a total of 23 names. is up overf 23 names 23% over the past year versus the s&p 500, up 17%. or per qe is working. >> adam mentioned bonds. let's take a look at where they traded. we did not see a big move in the treasury. we did seem a little bit of buying towards the end of the session there with the yield falling to 2.5 nine percent. if you take a look at the commodity markets we have had a down week for oil. it looks like it ended the week higher.

her had been expansion in supply. i was a son we're watching -- that was a sign we had been watching. ♪

forhis is "taking stock" may 2, 2014. the theme is overcoming obstacles in order to achieve success. don't ever give up. the u.s. economy continues its rebound and creates the most jobs in two years. the government called this mission accomplished. we will find out. company backeda by jeff bezos. the founder describes her victory over cancerou